Inflation swap hits NS&I certs

MORE than half a million savers with inflation-linked accounts will see their returns fall from today when renewing their investments.

Interest on National Savings & Investments (NS&I) index-linked certificates will now track the consumer prices index, which currently runs at 1.9 pc.

The switch means savers with £10,000 in an account will earn £191 interest tax-free instead of £241, a 20 pc fall.

They are popular because they are protected against rising prices and backed by the Government.

The certificates pay inflation plus 0.01 percentage points for two, three or five years.

They are no longer on sale, but existing holders can roll over their cash into new ones. NS&I will write to customers 30 days before their certificates mature.